Commissioner Decision Report
18 March 2015
Report of: Corporate Director, Development & Renewal
Classification:
Unrestricted
Granting of wayleave to UK Power Solutions for £100,000 premium
Lead Member
Originating Officer(s)
Wards affected
Key Decision?
Community Plan Theme
N/A
Service Head, Corporate Property & Capital Delivery
Spitalfields and Banglatown, Whitechapel, Stepney
Green and Bow East
No
Great Place to Live
Executive Summary
The Council is proposing to grant a wayleave to UK Power Solutions (UKPS)
permitting the installation of electricity cables underneath council-owned land. UKPS
is paying the council the sum of £100,000 for the wayleave.
The site being referred to is a riverside walk way managed by Parks and Open
Spaces providing a pedestrian link (along the A13) from Leamouth roundabout to
Canning Town Station. It should be noted that there are currently plans to relandscape the walkway as part of the funding secured from the London Legacy
Development Corporation which would improve the walkway. These works have
been delayed in order to accommodate the above request and save the
inconvenience of having the walkway dug up twice.
Strutt and Parker Surveyors has been appointed to act for the Council in negotiating
the wayleave and recommend that the premium is accepted, being considerably
more than the market norm (supporting documentation from Strutt and Parker forms
Appendix 1).
Time is of the essence in this matter. UKPS has requested that a decision on
whether the premium offer will be accepted is made by no later than 16th March in
order to allow UKPS to proceed with an alternative route with TFL if the Council
rejects the offer.
The Commissioners are asked to consider the offer of £100,000 and authorise
officers to instruct Legal Services to prepare and proceed with the wayleave
agreement.
This report sets out the background to this proposal.
Recommendations
The Commissioners are recommended to authorise officers to:
a) proceed with the wayleave on receipt of a premium of £100,000; and
b) to instruct legal services to proceed with the transaction.
1.
REASONS FOR THE DECISIONS
1.1
The payment of £100,000 represents above market prices for the granting of
the wayleave and represents a good financial deal for the Council.
2.
ALTERNATIVE OPTIONS
2.1
The alternative option is not to proceed with the wayleave whereupon UKPs
will proceed with an alternative route and the Council will not benefit from the
£100,000 payment.
3.
DETAILS OF REPORT
3.1
In September 2014 UKPS requested the council to grant a wayleave
permitting the installation of electricity cables within Silvocea Way and
Orchard Wharf in order to provide an electricity link up to the
Ballymore City Island development.
3.2
UKPS has a limited number of optional routes in which to lay the
cable. The two preferred routes are shown on the attached aerial
photograph (Appendix 2). The route highlighted in blue is the
preferred, shorter route which travels along Silvocea Way and Orchard
Wharf. The route highlighted in red is UKPS second choice of route
which travels across Transport for London (TFL) Land. UKPS is
currently in talks with TFL on the details of the red route. It is
understood that TFL is not seeking any form of premium in return for
granting a wayleave.
3.3
In December 2014 Asset Management instructed Strutt and Parker
Surveyors to provide advice on the level of premium that can be
charged to UKPS and to negotiate on the Council’s behalf. Strutt and
Parker has extensive experience in the granting of wayleaves and in
negotiating wayleave agreements. Strutt and Parker’s fee is 5% of the
premium agreed if the matter proceeds to completion.
3.4
Following two months of negotiations, on 11th February 2015, Strutt
and Parker reported a final offer from UKPS of £100,000. Strutt and
Parker recommend this offer is accepted and is in excess of what
would normally be expected from a wayleave of this nature.
3.5
Asset Management recommends that this offer of £100,000 is
accepted and that Legal Services is instructed to complete the
wayleave in line with the Heads of Terms which forms Appendix 3.
3.6
This matter was put to the council’s Asset Management Working
Group (AMWG) on 12th March. The AMWG have authorised the
matter to proceed subject to Commissioner approval.
3.7
UKPS has stated that it wishes to start works in March 2015. Should
the offer not be accepted by 16th March UKPS has stated that it will
proceed with the alternative route marked red on Appendix 2 with TFL.
3.8
Authority can be granted via the council’s scheme of delegation
paragraph 3.7 for which Service Head approval is sufficient (see
Appendix 4).
4.
COMMENTS OF THE CHIEF FINANCE OFFICER
4.1
As this wayleave will be agreed under officer delegated authority, the
comments of the Chief Finance Officer have not been sought at this stage.
The relevant extract from the Council’s constitution is attached at Appendix
4.
5.
LEGAL COMMENTS
5.1
As this wayleave will be agreed under officer delegated authority, legal
comments have not been sought at this stage. The relevant extract from the
Council’s constitution is attached at Appendix 4.
6.
ONE TOWER HAMLETS CONSIDERATIONS
6.1.
There are no immediate One Tower Hamlets considerations arising from this
report.
7.
SUSTAINABLE ACTION FOR A GREENER ENVIRONMENT
7.1
There are no immediate ‘sustainable action for a greener environment’
implications arising from this report.
8.
RISK MANAGEMENT IMPLICATIONS
8.1
Strutt and Parker states that £100,000 represents a good financial deal for
the Council and is a higher figure than what was initially expected. If this
offer is not accepted by the 16th March 2015 it is highly likely that UKPS will
proceed with the alternative TFL route and the Council will lose the
opportunity of proceeding with this transaction.
8.2
In the event that at some time in the future the Council requires the cabling
to be moved the cost of ‘lifting and shifting’ the cabling to an alternative route
will need to be met by the Council. The likelihood of this happening however
is small. The site is a dedicated river walkway and there is already existing
cabling under the walkway.
9.
CRIME AND DISORDER REDUCTION IMPLICATIONS
9.1
There are no immediate crime and disorder implications arising from this
report.
10.
EFFICIENCY STATEMENT
10.1
Not required.
11.
SAFEGUARDING IMPLICATIONS
11.1
There are no immediate safeguarding implications arising from this report.
____________________________________
Linked Reports, Appendices and Background Documents
Linked Report
• NONE
Appendices
Appendix 1. Supporting document from Strutt and Parker
Appendix 2. Aerial view of the two preferred routes for UKPs
Appendix 3 Proposed Heads of Terms.
Background Documents – Local Authorities (Executive Arrangements)(Access
to Information)(England) Regulations 2012
• NONE
Officer contact details for documents:
• Kevin Pulsford, Principal Asset Manager ext 4609
APPENDIX 2
DRAFT HEADS OF TERMS
1.
Property:
Land adjacent to Silvocea Way, Leamouth North Project
2.
Grantor:
London Borough of Tower Hamlets
Mulberry Place
5 Clove Crescent
London
E14 2BG
3.
Grantor’s Agent:
Duncan Howie
Strutt & Parker LLP
Coval Hall
Chelmsford
Essex
CM1 2QF
Tel: 01245 – 254644
4.
Grantor’s Solicitor:
tbc
5.
Grantee:
U K Power Solutions
River View House
Bonds Mill Estate
Stonehouse
Gloucestershire
GL10 3RF
6.
Grantee’s Solicitors:
tbc
7.
Consideration Fee:
£100,000
8.
Proposed Works:
To install 11kV underground cable on the land.
9.
Terms:
Parties will enter into a standard wayleave agreement prior
to the easement being completed.
UKPS to be responsible for undertaking and bearing the full
costs of the works.
UKPS to be responsible for restoring the site and making
good any damage following the works and following any
future maintenance of them. All damages to the London
Borough of Tower Hamlets property and wider estate will be
compensated if damaged.
UKPS to maintain all the equipment
The grantor is entitled to lift and shift if planning permission
is obtained. The grantor is to offer alternative cable route
on his land or wider estate. The grantor will bear the cost
for lift and shift.
10.
Costs:
All parties to pay their own costs.
Corporate
Director
Development
& Renewal
Service
Head
Asset
Strategy,
Capital
Delivery,
Property
Services
Development
& Renewal
Asset
Strategy,
Capital
Delivery,
Property
Services
Corporate
Property
Services
To grant easements in,
over or through
Council land subject to
consultation with other
departments as
appropriate
Development
& Renewal
Asset
Strategy,
Capital
Delivery,
Property
Services
Corporate
Property
Services
To authorise the
acquisition of land and
premises in
accordance with
Council Policy and the
Asset Management
Plan procedures
subject to the purchase
price not exceeding
[£250,000?]
3.10 To grant licences for
temporary/short term
works on Council
owned land where
appropriate
Development
& Renewal
Asset
Strategy,
Capital
Delivery,
Property
Services
Development
& Renewal
Asset
Strategy,
Capital
Delivery,
Property
Services
3.11 To approve after
Development
consultation with the
& Renewal
Corporate Director
Resources
appropriations
between relevant
function areas and
statutory holding
powers, except where
public notice of the
proposed appropriation
is required and
objections are received
Asset
Strategy,
Capital
Delivery,
Property
Services
Decision
3.6
3.7
3.8
To be responsible for
conducting
negotiations on the
Council’s behalf in
relation to the sale or
acquisition of any
property, whether
freehold, leasehold or
by licence.
To grant wayleaves to
statutory undertakers
and other third parties
over and under land
owned by the Council
3.9
CONSTITUTION November 2010
Section Head
Other (name post)
Corporate
Property
Services
Corporate
Property
Services
428